If you're wondering why Southwest Airlines Co. (LUV) shares were sliding in Thursday's premarket session, look no further than the price of oil. The stock was down about 2.2% as global energy prices spiked, with Brent crude topping $100 a barrel and WTI futures climbing toward $95. For an airline, that's basically like watching your biggest expense category suddenly get a lot more expensive.

The driver here is geopolitical. The U.S.-Iran conflict has entered its thirteenth day, creating significant regional instability and overshadowing global efforts to stabilize oil supply. Even as President Donald Trump claimed Wednesday that the U.S. has "won" the war, attacks continue. In response to the price surge, Energy Secretary Chris Wright announced the Department of Energy will release 172 million barrels from the Strategic Petroleum Reserve next week to try and curb costs. It's a classic move: when prices go up, tap the strategic reserve. Whether it works is another question.

For airlines, this isn't just a minor inconvenience. Jet fuel is one of their top variable expenses. Veteran trader Peter Brandt recently put it bluntly on X: "If Crude Oil does what the chart indicates might be possible, then airlines are headed for a world of hurt." That's trader-speak for "this could get ugly." When fuel costs rise, it squeezes margins and makes it harder to turn a profit, especially for a carrier like Southwest that's known for its low-cost model.

So where does that leave the stock from a technical perspective? It's trading about 16% below its 20-day simple moving average, which suggests some short-term damage, but it's still roughly 0.2% above its 100-day SMA, indicating the intermediate trend might still be intact. Think of it as a bruised but not broken chart. The shares are up about 39% over the past year, and they're sitting closer to the middle of their 52-week range after pulling back from a February peak. Key resistance sits at $43.50, while key support is at $40.50. The stock currently carries an average Hold rating with a price target of $43.33.

Analysts, as usual, are all over the map. TD Cowen lowered its target to $55 but maintained a Buy rating on March 9. Rothschild & Co raised its target to $35 but kept a Sell rating on March 5. And back on February 27, TD Cowen upgraded the stock to Buy and raised its target to $66. So you've got targets ranging from $35 to $66—which basically covers the entire spectrum of possible outcomes. It's the kind of divergence that tells you the market is trying to figure this out in real time.

By the numbers, Southwest Airlines shares were down 2.21% at $40.75 during premarket trading on Thursday. The story here is simple: oil up, airlines down. It's a relationship as old as the jet age, and right now, it's playing out exactly as you'd expect.